According to HRM Exam, “Strategic human resource management (HRM) is the process of linking the human resource function with the strategic objectives of the organization in order to improve performance.” Adopting an HR strategy that is concerned with the organization’s larger mission and goals has multiple advantages and benefits for the company.
Helps Evaluate HR Policies
The premise of strategic HRM is that the company’s policies and procedures related to employees should fit into the organization’s broader strategic plan. Developing these links between HR and strategy has the distinct advantage of helping the organization to evaluate its current HR policies and to replace outdated or inefficient policies with ones that promote a better workplace environment and employee relations.
As the company evaluates its HR policies, it can use the strategic plan’s aims and objectives to evaluate each HR process. Those that fall out of the strategic vision can be reformulated or discarded in favor of better ones.
Improves Team-building
Strategic HRM also helps to foster a sense of team spirit and camaraderie within the organization. A company’s strategic vision will ideally rely on input from a broad range of stakeholders including managers, employees, customers and investors. Creating an HR strategy that aligns with this sense of open communication can have the major benefit of helping stakeholders feel like their opinions are valued and meaningful to the company’s owners and executives.
Helps Monitor Progress
While the strategic vision of the company can influence the creation and evaluation of HR policies, the reverse can also be true. Human resources can help the organization monitor its progress toward achieving its stated goals and objectives in the strategic plan. Much of the strategic plan is likely to rely on the cooperation and support of employees and individual departments or functions within the organization.
HR has a key role to play in making sure that all of these components of the strategic plan are implemented in a timely and effective way. The advantage of this marriage between strategy and HR management is that the company’s executives and its HR function are consistently monitoring one another’s progress and tweaking processes for the benefit of the company and its employees.
Keeps the Organization Legal
A final advantage of the human resource management strategy is in keeping the organization compliant with laws relating to employees, salary, insurance and the like. The laws and policies governing business are complex and can vary between jurisdictions, but HR has a key role to play in making sure that the organization’s strategic plan is not only presently legal but is also amendable enough that it can adapt to changing times and changing legal circumstances.
